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 The "head scab" fungus can produce vomitoxin, a chemical that is
poisonous to humans and livestock when consumed at high levels. This
year, soft red winter wheat has been hit badly by the fungus, which
develops when it rains during the crop's key growing period.
Head scab, which scientists call fusarium head blight, can hit
profits of farmers and grain handlers hard, while raising costs for
bread and cereal makers.
Previous outbreaks cost the U.S. wheat and barley industry $2.7
billion from 1998 to 2000, then another estimated $4.4 billion in
2011. It is too soon to know the full economic losses for 2014.
In addition, unsellable wheat has been competing for storage space
with bumper corn and soybean crops about to arrive in the autumn
harvest. Cleaning the wheat reduces vomitoxin levels as it sifts out
damaged grain, but it can cost about $1 per bushel for farmers.
Wheat currently sells at around $5 per bushel.
"This is the worse I've ever seen it," said Wiechert, owner of
Wiechert Seed Inc., which he has operated since 1985. The business
is 50 miles southeast of St. Louis, Missouri, near the epicenter of
a vomitoxin outbreak.
"We're trying to get the vomitoxin down to a sellable level and
trying to get the test weights up," he said.
Head scab shrivels the grain. This reduces test, or average, weights
from the harvest, which also cuts profits. This outbreak will hit
farm incomes that are already down for the first time in several
years, shrinking 27 percent in 2013/14 from a year earlier,
according to data from the U.S. Department of Agriculture.
Livestock that consume feed made with scabby wheat can get sick with
vomiting and diarrhea. Some will refuse to eat the feed, reducing
the amount of weight they gain.
Diseased wheat can be blended with higher quality product to reduce
the concentration of the chemical to acceptable levels, but some
grain handlers are struggling to find good SRW wheat near at hand.
Farmers whose wheat carries large amounts of the pink-tinged damaged
crop face deep discounts at elevators, and some grain will get flat
out rejected for purchase.
VOMITOXIN LEVELS RISE
Soft red winter (SRW) wheat is grown in a large eastern section of
the United States, in the south from Louisiana and Arkansas across
to the Carolinas and in the north from Missouri across the Midwest
to Pennsylvania and Maryland.
It accounted for about 19 percent of the U.S. total wheat crop in
2009 through 2013 and is used typically for cakes, biscuits and
pastry.
Exports, excluding China, through the July 2014 marketing year
totaled about 1.7 million tonnes, down from 2.0 million tonnes in
the previous year, according to data from the U.S. Wheat Associates.
"It is in a lot of the wheat, areas east of the Mississippi River
would be the most suspect, all along the U.S. Gulf and through the
Eastern Seaboard. There were even high levels coming out of
Pennsylvania," said Max Hawkins, a livestock nutritionist at Alltech
Inc, a feed company based in Lexington, Kentucky.
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Vomitoxin levels are coming in well over approved maximums for both
livestock consumption and for products eaten by humans.
A preliminary survey from the U.S. Wheat Associates showed composite
vomitoxin level from more than 500 samples across nine states was at
2.5 parts per million (ppm) for the 2014 SRW wheat crop, much higher
than 1.4 ppm in 2013 and the five-year average of 1.3 ppm.
The U.S. Food and Drug Administration restricts vomitoxin in
finished products such as flour to 1 ppm. The FDA advises total
diets for chicken and cattle have less than 5 ppm and swine at 1 ppm.
Export buyers typically limit levels to 2 ppm.
HARVESTING, STORING UNSELLABLE WHEAT
Farmers with crops hit badly by head scab will get steep discounts
if they want to sell their wheat. Some Midwest grain elevators have
set discounts for vomitoxin levels between 6 ppm to 10 ppm anywhere
from 40 cents to $2 per bushel. Many locations rejected wheat with
levels of 10 ppm and higher.
Farmers are growing more frustrated as the autumn harvest for corn
and soybeans approaches. Normally, they would sell the wheat,
leaving on-farm storage bins empty and available for freshly cut
crops, Wiechert said.
"They're scrambling around trying to find out if they can put more
storage bins (on the farm), or if they can find a place to store it,
because it is really going to cause a problem this fall," Weichert
said.
Dave DeVore, a grain merchant at Siemer Milling with facilities in
central Illinois and western Kentucky, said he must buy wheat
outside of his normal purchase areas due to high vomitoxin levels.
"We're seeing about 10 ppm and I don't know that we have seen that
before. The elevators are not sure what they're going to do with
that wheat," DeVore said.
While DeVore does not expect to have any issues making high quality
flour for customers, his input costs will certainly rise.
"You have to pay more simply because of the freight costs. If we
have wheat railed in, we have additional freight costs and that's
the biggest thing, the freight costs," DeVore said.
(Additional reporting by Julie Ingwersen)
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